Correlation Between Precise Biometrics and Bong AB

Can any of the company-specific risk be diversified away by investing in both Precise Biometrics and Bong AB at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Precise Biometrics and Bong AB into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Precise Biometrics AB and Bong AB, you can compare the effects of market volatilities on Precise Biometrics and Bong AB and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Precise Biometrics with a short position of Bong AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Precise Biometrics and Bong AB.

Diversification Opportunities for Precise Biometrics and Bong AB

0.61

Correlation Coefficient

Precise Biometrics  Bong AB

Poor diversification

The 3 months correlation between Precise and Bong is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Precise Biometrics AB and Bong AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bong AB and Precise Biometrics is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Precise Biometrics AB are associated (or correlated) with Bong AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bong AB has no effect on the direction of Precise Biometrics i.e., Precise Biometrics and Bong AB go up and down completely randomly.

Pair Corralation between Precise Biometrics and Bong AB

Assuming the 90 days trading horizon Precise Biometrics AB is expected to generate 3.7 times more return on investment than Bong AB. However, Precise Biometrics is 3.7 times more volatile than Bong AB. It trades about 0.0 of its potential returns per unit of risk. Bong AB is currently generating about -0.11 per unit of risk. If you would invest  493.00  in Precise Biometrics AB on December 30, 2024 and sell it today you would lose (67.00) from holding Precise Biometrics AB or give up 13.59% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Precise Biometrics AB  vs.  Bong AB

Precise Biometrics

Risk-Adjusted Performance

Very Weak

Over the last 90 days Precise Biometrics AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Precise Biometrics is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Bong AB

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bong AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Precise Biometrics and Bong AB

The main advantage of trading using opposite Precise Biometrics and Bong AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Precise Biometrics position performs unexpectedly, Bong AB can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Bong AB will offset losses from the drop in Bong AB's long position.

The idea behind Precise Biometrics AB and Bong AB pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.